I'm the Founder and Managing Partner of Ironfire Capital LLC, which runs a tech-focused hedge fund and angel fund. I did a Ph.D. in Management at the Columbia University Graduate School of Business in New York, with a specialization in Strategic Management. You can follow me on Twitter @ericjackson, subscribe to me on Facebook, follow me on Sina Weibo, or Circle me on Google+. My email is: dr.eric.jackson@me.com

For most of these funds, managing multi-billions of dollars in AUM, buying a million shares of Facebook is not a big deal. It is probably at the bottom of the list in that fund’s over 100 largest positions.

Even for Chase Coleman’s Tiger Global, you’re talking about a $200 million position. He’s got $11 billion in AUM. This Facebook stake is 2% of his AUM. It’s a bit of a flier to be honest. If Facebook doubles in value, Chase now manages $11.2 billion. He’s made 1.8% for his investors.

Yet the mainstream business media – some might say “lamestream” business media — presents these buying patterns related to Facebook as a sign that the “smart money” — in their words, “the top hedge fund stock pickers” — is bullish once again on Facebook.

The implication is perhaps you, dear reader, should too consider getting long some Facebook shares, if you want to do as the top stock pickers do.

I loved this line in the piece:

The well-regarded $10 billion endowment of the Massachusetts Institute of Technology also added a position in Facebook of 411,000 shares in the quarter. The school is located just a few miles away from Harvard University, where Facebook CEO Mark Zuckerberg famously dropped out in 2004 to found the company.

Really? It’s well-regarded by whom? Never you mind. They have $10 billion under management. What’s the size of your IRA? Of course, they must be smart if they manage an endowment. I suppose it’s reasonable to assume these money managers must have rubbed shoulders with Mark Zuckerberg in the Cambridge bars back 10 years ago when he was there. And they must have decided, 10 years hence, I’m going to make a big bet on this kid with my employer’s money.

So how much did MIT pony up? $7.8 million. That’s million… with a capital “M.” That’s not even 1% of their AUM. That’s 0.078%. If 1% is a dollar. They bet 7.8 cents of $1. Someone call the MIT President: we’ve got some drunken money managers running the alum’s money.

The most amazing part of the story is that in the last 3 paragraphs of the story they casually mention another tech name that hedge fund managers seem to like: Yahoo (YHOO).

It so happens that Chase Coleman of Tiger Global — the big spender of all the smart hedge fund managers who bought Facebook – also bought some Yahoo shares last quarter: 25 million shares. That’s about double the sized stake that he put to work in Facebook. Yet, Reuters mentions it as an afterthought.

Oh, and David Einhorn and Boaz Weinstein also bought some Yahoo stock last quarter. But pay to attention to that. Reuters wants you to know that it’s Facebook that the top stock pickers really zeroed in on.

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